How to Create a Budget Worksheet (With Template and Example)

By Indeed Editorial Team

Published June 17, 2022

The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.

Budgeting your money is one of the most important actions you can take to increase your financial security. Budget worksheets can help you manage your expenses and income so that you have a clear idea of the state of your finances. Learning more about effective worksheets can help you keep track of expenses, identify spending patterns that can help you avoid over-spending, and improve your ability to save money each month.

In this article, we discuss what the concept means, explore what to include in it, review its importance, discover how to use one, highlight tips on how to use it, and provide an example.

What is a budget worksheet?

A budget worksheet is a tool that helps you track and plan your spending, allowing you to manage your finances better and make more informed financial decisions. It typically includes categories for expenses such as housing, utilities, transportation, food, entertainment, and savings. By monitoring your spending and identifying areas where you can cut back or save more, a worksheet can help you make significant progress towards your financial goals.

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What to include in a budgeting worksheet

To create a custom budgeting worksheet, you need records of your income, expenses, and savings. To make sure the numbers you include are correct and up-to-date, use pay stubs, bank statements, credit card statements, receipts, and other documentation. Plan to include the following categories in your worksheet:

  • Income: Include all incoming money, such as paychecks, contractor payments, tips, and other sources of income, like child support or investments. You can also divide your income into categories like net pay and disposable income.

  • Housing and utilities: Include mortgage or rent payments, property tax, household insurance, and maintenance or repairs. Also include natural gas, electricity, water, sewage, other utilities, and phone, cable, and internet bills.

  • Transportation: In this category, you can include vehicle payments, insurance, maintenance, and recurring costs like parking, gas, and tolls. It also includes public transport and taxis or ride-sharing.

  • Food and household supplies: This includes groceries, nights out at restaurants, takeout, and delivery orders. Household items can also include toiletries, cleaning supplies, and pet food.

  • Healthcare: You can include insurance premiums, co-pays for prescriptions, over-the-counter medications, and any other health-related expenses you incur. It also includes mental healthcare, like therapy sessions or medication costs.

  • Personal care: Here, you can include haircuts, grooming, and other personal expenses like buying new clothes or getting a manicure. Personal care can also include the cost of children's daycare or care for elderly family members.

  • Family care: Include outgoing child support payments and tuition or school fees. Consider also any school supplies, laundry expenses, and other family-related costs.

  • Finance: Include bank fees and charges and credit card payments, loans, and other financial obligations. You can also include debt repayment amounts like a mortgage, car loan, or student loan.

  • Miscellaneous: This can be a category for anything that doesn't fit into the other categories. It can include expenses like gifts, entertainment, and subscription services.

  • Savings: Include any money you put aside each month for emergencies or long-term expenses like retirement. Try to set goals for how much you want to save each month and revise your budget as needed.

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Why is a budgeting worksheet important?

A budgeting worksheet is a simple spreadsheet or chart where you can record your income, expenses, and savings. Using this type of worksheet offers several benefits, including:

Tracks income and expenses

It tracks income and expenses in one convenient place, making it easy to see where your money is going. That means you can quickly assess whether you've balanced your budget, if you can reduce expenses, or if it's possible to increase income. It can also help you identify areas where you can reduce spending or make changes.

Helps you spend within your means

When you add each section of the worksheet, you can understand whether your expected income is enough to pay for your planned expenses and savings. A worksheet ensures you don't overspend or take on more debt than you can handle. This is especially important if you're trying to get out of debt or improve your financial situation.

Related: What Are Accounting Transactions? (Definition and Examples)

Easy to identify errors

It tallies your planned expenses, savings and income, and actual numbers for each category. With a worksheet, you can easily detect discrepancies and identify areas where you can make adjustments. It also allows you to see if there are any areas where you can improve your budget.

Calculates additional money

It calculates your disposable income or additional money left at the end of each time period. With this calculation, you can determine whether you have extra money for savings or whether you might reduce on expenses. You can also use it to set goals and track your progress.

Reveals spending patterns

As you divide the worksheet into categories, it can help you understand where most of your spending happens. It can help assess whether too much of your income goes into categories that aren't essential, like entertainment or eating out. Once you know your spending patterns, you can make necessary changes to help ensure you've balanced your budget.

Related: What Type of Budget Should I Use? (With Descriptions)

How to use a budgeting worksheet

There are several steps you can take to use a budgeting worksheet effectively:

1. Compile your income and expenses

The first step is to gather all of your income and expenses. This includes your salary, side job earnings, rent or mortgage payments, utilities, phone bills, transportation costs, food expenses, personal care items, family care expenses such as childcare or eldercare, finance charges from credit cards or loans, and any miscellaneous costs like entertainment, gifts, or other items. It may also be helpful to set aside a small amount to put towards savings each month.

2. Analyze your budget and expenses

It's important to analyze your income and expenses to see where you might be overspending or under-budgeting. For example, if you notice that a large portion of your monthly expenses goes toward entertainment or eating out, this may indicate that you may reduce spending in those areas. Similarly, if you find that you're not putting enough money towards savings, you might adjust your budget accordingly.

3. Determine your time frame

When determining your budget and expenses, it can also be helpful to set a time frame. For example, you might track your spending for a month or for a year. Having a specific time frame in mind can help you better assess your progress and make necessary changes along the way.

4. Create categories

Once you have all of your income and expenses, you can start categorizing them. This helps you see where most of your money is going and understand your spending patterns. You might have categories like housing, transportation, food, personal care, family care, finance, and miscellaneous.

5. Add up your totals

To get a complete overview of your budget, you can add up your totals for each category. This helps you see whether you are over or under budget in specific areas, and can help you make adjustments where necessary. For example, if you find that you are spending too much on food, you might reduce spending in other areas or find ways to save money on groceries.

6. Balance your budget

Ultimately, your goal is to balance your budget so that you aren't spending more money than you earn. This means taking steps to reduce your expenses, increase your income, or both. For example, you might look for ways to reduce your housing costs by finding a cheaper apartment or roommates, or you might try to earn more money by picking up extra shifts at work or starting a side job.

Tips for using a budgeting worksheet

Here are a few tips to keep in mind when using a budgeting worksheet:

  • Track your income and expenses over time: A budgeting worksheet isn't a onetime exercise and it's important to track your finances over time. This can help you see how your spending patterns change and where you might make adjustments.

  • Review your budget regularly: It's also important to review your budget regularly, perhaps once a month or once a week. This can help you stay updated on your financial situation and make any necessary changes to meet your goals.

  • Be flexible: It's important for a budget to be a flexible tool that you can adjust as your needs change. For example, if you get a raise at work or have an unexpected expense, you might adjust your budget accordingly.

  • Create multiple budgets: If you have different financial goals, you might create multiple budgets. For example, you might have a budget for your monthly expenses and another budget for saving for a down payment on a house.

Example of a budgeting worksheet

Here's an example of what a budgeting worksheet might look like:

Income
Salary: $3,000
Side job: $500
Total: $3,500

Expenses
Rent: $1,000
Utilities: $200
Phone bill: $100
Transportation: $150
Food: $250
Personal care: $50
Family care: $75
Finance: $100
Miscellaneous: $200
Savings: $500
Total: $3,075

Disposable income: $425

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